Shaw Communications, the family-controlled media giant, won court approval for its proposed takeover of Canwest Global's broadcasting arm on Wednesday after amending its offer to include a $10.6 million payout to shareholders, including Canwest's founding family.
Shaw initially made its $1.9 billion offer for bankrupt Canwest in May, but the deal was opposed by shareholders, including the founding Asper family, on the grounds that they would receive nothing from the takeover as the money would be used to repay debts. (Continue reading here)
After two days of negotiations between the two parties, a deal was reached that included a $10.6 million payout to the shareholders as part of the acquisition. The Ontario Superior Court of Justice approved the deal on Tuesday evening.
The Asper family, which owned 48% of Canwest, will get $4.3 million as part of the acquisition.
Canwest was founded in 1974 by Izzy Asper, who built the media empire along with his son Leonard. However, the pair overstretched themselves with acquisitions including the $3.2 billion purchase of Southam newspaper chain, saddling the company with an unmanageable debt. This, combined with the onset of the economic crisis, led Canwest to file for bankruptcy in 2009.
Shaw Communications, also based in Canada, is currently headed by third-generation Jim Shaw, who has expanded the family cable business into a media giant with 2009 revenues of $3.4 billion.
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